Doctors can make or break a healthcare system.
That's the lesson in the failure of an eight-hospital rural network in central Washington state.
The 2-year-old group, Columbia Basin Regional Health Network, is dissolving after an April vote of its membership. Like many rural and urban networks, it began with an ambitious intent: to become financially responsible for the health of enrollees in managed-care plans.
Many things worked against the network, but probably its biggest problem was a lack of physician commitment, says Scott Campbell, who became the network's director last June.
Campbell now is managed-care coordinator of 50-bed Samaritan Hospital in Moses Lake, Wash., one participant in the network.
The other hospitals involved in the network were 58-bed Columbia Basin Hospital, Ephrata; 48-bed Coulee Community Hospital, Grand Coulee; 17-bed East Adams Rural Hospital, Ritzville; 95-bed Lincoln Hospital, Davenport; 39-bed Odessa (Wash.) Memorial Hospital; 32-bed Othello (Wash.) Community Hospital; and 38-bed Quincy (Wash.) Valley Hospital.
Hospitals drove the formation of the network. The Washington State Hospital Foundation, which is tied to the state hospital association, contributed $100,000 to the network's startup; the hospitals added $40,000. At the time, Washington state had enacted a major healthcare reform law that would have put most of the population in managed-care plans by 1999. It was scaled down significantly in 1995.
Campbell says he can't overemphasize how important the leadership of a dynamic physician is to a network's success. Without one, the network couldn't get physicians interested in participating.
"Physicians felt (the network) was done for the hospitals," Campbell recently told an audience of rural healthcare executives.
He was speaking at a symposium on rural networks at the National Rural Health Association meeting last month in Seattle. Campbell later elaborated on his talk in an interview.
Another reason the Columbia Basin network never won the support of physicians is that they had no need for creative contracts, he says. The Wenatchee (Wash.) Valley Clinic, about 70 miles from Moses Lake, created an independent practice association that gave doctors access to its managed-care contracts without requiring them to join the clinic. Those contracts most notably included the state Medicaid program, one of the biggest sources of payment in rural areas.
With only two contracts covering 460 people, Columbia Basin ceased most of its activities early this year and formalized its dissolution in April.
Bruce Amundson, M.D., president-elect of the NRHA and a Seattle-based consultant, says many rural networks are having a hard time winning over physicians. Because most networks are hospital-created, their administrative structure tends to reflect that of hospitals, Amundson says. In rural areas, that almost always means no physician executives.
"This is a very serious problem," Amundson says. "We frequently see the organizational efforts get way downstream before the physicians are even involved, let alone participating. The extent to which physicians emerge as real leaders is a very important variable for success."
Not only have many networks failed to involve physicians, they also have failed to work with their communities, says Ira Moscovice, a professor at the University of Minnesota's rural health research center. "Up to now, they're trying to create benefits for members instead of addressing community health," Moscovice says.
But most networks are very young. Of the roughly 180 rural health networks Moscovice identified in a recent study, 70% are 3 years old or younger. Most say their major accomplishment to date is organizing.
Moscovice, working with the Healthcare Research and Educational Trust of the American Hospital Association, plans to develop tools such as boiler-plate contracts to ease network organization and increase its likelihood of success.
Besides the lack of physician leadership, many other forces contributed to the downfall of the Columbia Basin network, Campbell says. For example, the network didn't have dedicated staff from its formation in early 1995 until February 1996, when an interim administrator was brought in under contract with a management group. Campbell came on as the network's permanent director in June 1996.
While the network searched for a perfect leader, the Wenatchee Valley Clinic established itself in the market. Campbell says the better decision would have been to hire an energetic leader willing to learn, rather than to search for someone with experience in managed-care contracting.
Other lessons include:
The need to work closely with health plans. The Columbia Basin network should have done a better job assessing the desires of health plans in advance so it could have drawn more interest from them, Campbell says.
"Talk with health plans to see how they see the market," he advises other network organizers.
The need to get members to work for the good of the group. Samaritan in Moses Lake hoped to increase its referrals, but hospitals in the network, particularly in its eastern region, already had strong ties to Spokane providers.
Meanwhile, hospitals farther west tended to refer complex cases to Wenatchee, Campbell says.
Nevertheless, the network wasn't a complete loss. Its four eastern Washington hospitals, all district-run, recently formed an interlocal agreement to work together.
Meanwhile, Samaritan is assessing whether Moses Lake-area physicians are interested in a local physician-hospital organization. Campbell says the hospital won't go forward without strong physician interest.
Amundson warns networks not to forget their end goal. "To a significant degree, network development has become a mantra for rural health, as if the network were an end in itself," he says. "But it's not. It's do something for your communities."